Question
Please respond to the following questions regarding the Gemini Electronics. 1) Prepare cash flow statements for each year 2008 and 2009. (Note: the equity account
Please respond to the following questions regarding the Gemini Electronics.
1) Prepare cash flow statements for each year 2008 and 2009. (Note: the equity account would change each year by net income earned for the year less dividends paid plus proceeds from shares issued. You may assume the firm did not issue new shares either year. Net income for the year is captured at the beginning of the cash flow statement. Dividends paid should be included in the statement as a financing activity.)
2) Calculate the asset management, profitability, debt management, and liquidity ratios we reviewed in class for each of the past three years.
3) Prepare common-size income statements and balance sheets for each of the past three years.
4) Based on the analyses completed above, evaluate Geminis financial health How well has the company been performing? What concerns, if any, do you have about the firm? What recommendations would you make?
GEMINI ELECTRONICS LTD. | |||
INCOME STATEMENT | |||
2007 | 2008 | 2009 | |
Sales | 8,671,715,000 | 12,175,476,500 | 13,664,714,160 |
Cost of Goods Sold | 5,032,513,200 | 7,886,796,000 | 8,974,149,576 |
Gross Profit | 3,639,201,800 | 4,288,680,500 | 4,690,564,584 |
Operating Costs | |||
Selling and Distribution | 854,300,000 | 934,532,230 | 1,001,234,530 |
R&D | 365,660,340 | 476,350,230 | 785,774,340 |
Administration | 832,740,300 | 999,453,230 | 980,340,500 |
Amortization | 187,929,165 | 288,216,088 | 394,440,051 |
Operating Profit | 1,398,571,995 | 1,590,128,722 | 1,528,775,163 |
Interest | 288,898,584 | 277,686,944 | 329,923,700 |
Earnings Before Taxes | 1,109,673,411 | 1,312,441,778 | 1,198,851,462 |
Taxes | 388,385,694 | 459,354,622 | 419,598,012 |
Net Income | 721,287,717 | 853,087,156 | 779,253,450 |
GEMINI ELECTRONICS LTD. | |||
BALANCE SHEET | |||
Cash | 1,437,227,573 | 1,366,526,361 | 1,413,474,400 |
A/R | 1,201,094,250 | 1,328,523,975 | 1,503,560,340 |
Parts Inventory | 960,875,400 | 1,062,819,180 | 1,201,345,530 |
WIP Inventory | 66,650,675 | 75,640,210 | 89,575,400 |
Finished Goods Inventory | 1,451,230,215 | 1,605,660,505 | 1,805,340,520 |
Total Current Assets | 5,117,078,113 | 5,439,170,231 | 6,013,296,190 |
L,P,& E, Net | 1,317,388,220 | 2,281,077,095 | 3,363,891,508 |
Intangibles | 561,903,428 | 601,083,781 | 580,509,006 |
Total Assets | 6,996,369,761 | 8,321,331,107 | 9,957,696,704 |
A/P | 1,305,530,320 | 1,509,430,300 | 1,564,430,450 |
Current Portion of LT Debt | 607,184,919 | 651,847,287 | 785,532,620 |
Total Current Liabilities | 1,912,715,239 | 2,161,277,587 | 2,349,963,070 |
Long-term Debt | 3,035,924,595 | 3,259,236,437 | 3,927,663,101 |
Shareholders Equity | 2,047,729,927 | 2,900,817,082 | 3,680,070,533 |
Total Liabilities and Equities | 6,996,369,761 | 8,321,331,107 | 9,957,696,704 |
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